One of the Most Important Lessons About Life and Making Money You Can Ever Learn

In 1927, Hugh Roy Cullen was approached by Jim West, a wealthy lumberman who had invested in projects with Cullen in the past.  On a Saturday, West called Cullen to his downtown Houston office, where he made the following offer:

I’ve got $3,000,000 lying around.  And I’ve got the West Production Company, which don’t amount to much.  I’ll put the $3,000,000 in my oil company, and give you one-fourth interest – if you’ll go in with me.  You’ll be president – and have complete charge of the company.

In one fell swoop, Cullen, who was successful but by no means rich, was offered a 25% ownership stake in a business with a worth of roughly $40,000,000 today in inflation-adjusted terms.  Overnight, he would have been worth the equivalent of nearly $10,000,000 today. Plus, he’d get a quarter of all the future profits if they were successful and have complete operating control.  It could have been the platform that skyrocketed him to the fortune he had always desired, despite being a fifth-grade dropout who grew up in relative poverty.

Cullen said he would have to think it over.

According to Bryan Burrough’s account in The Big Rich: The Rise and Fall of the Greatest Texas Oil Fortunes:

The following Tuesday, having heard nothing from Cullen, West telephoned him again.  “I made a proposition to you last Saturday, and since then I haven’t heard a damn thing from you, ” West said. “I offered to give you almost a million dollars, and you haven’t taken the trouble to reply.  What’s your answer, Roy?”

“Not interested,” Cullen said.

For a moment West was speechless.  “Not interested!” he barked.  “My God – what do you want!”

“Tell you what I’ll do,” Cullen said.  “I’ll go in the oil business with you – fifty-fifty.  For every dollar you put in, I’ll put in a dollar.  But only on condition that I have full charge – no interference.”  West went quiet for a moment.  “Roy,” he said after a moment, “I didn’t know you had that kind of money.”

He didn’t.  “I’ll put up five thousand dollars [the equivalent of $63,371 today], “Cullen said, “and you put up five thousand.  We’ll each have half-interest.”

West didn’t understand.  “I offered you three million dollars, Cullen – and you’d get a quarter of that (outright).  You’ll turn that down and put up five thousand of your own money?”

“That’s right,” Cullen said.  That way, he went on, “I won’t be working for you.”

Later they flipped a coin to determine whose name went first.  Cullen won; the new partnership was named Cullen & West.

Twenty years later, when he died, Cullen had a net worth of $200 million to $300 million, which would be $2 billion to $3+ billion today.

This is one of the lessons I want you to learn.  I will never grow tired of saying it: Your goal is not simply the amassing of money for the sake of money.  Money is a tool.  It is designed to give you the life you want.  To Roy Cullen, independence was more important than money.  He knew himself.  I will hammer this into you for as long as I am writing.  I’ve seen too many people forget it and squander what counts.

[mainbodyad]You have to know yourself.  You have to know what you value.  Don’t just chase a bigger income; a higher net worth.  Decide how you want to live, how you want to spend your time, what you want to be doing when you wake up in the morning.  Then figure out how to get your hands on enough money to give you that life.

The real wealth is time.  It’s all about doing what you love, when you want, and how you desire.  Money is the facilitator.  Don’t work for it, make it work for you.  Otherwise you will wake up older, approaching death, and realize you have squandered all of your life capital for financial capital that now has little utility to you.

The figure is different for each of you.  For some, it is $15,000 a month in dividends, interest, and rents that require no work.  For others, you need an income of $100,000,000 a year because you have ambitions of ranking among the wealthiest Americans in history.  Decide what will serve you best, and then work toward it.  Don’t let your happiness depend on it, though.  Enjoy your journey along the way and make it a game.  That way, even if you fall short either through fate or some other misfortune, you still wouldn’t do anything differently so that you can say yours was a life well lived.